Yes, you can contribute to both a Roth 401(k) and a Roth IRA in the same year

The IRS treats these as separate accounts with separate contribution limits, so maxing out one does not prevent you from funding the other. A Roth 401(k) is an employer plan; a Roth IRA is an individual account you open on your own. Because they are different types of accounts, the contribution rules do not overlap the way they do between a traditional IRA and a Roth IRA.

The catch is that your income may limit how much you can put into a Roth IRA, and your employer may not offer a Roth 401(k) at all. You also need earned income in the year you contribute to either account — you cannot fund them from investment returns, gifts, or inheritance alone.

Key Takeaways

  • You can contribute to a Roth 401(k) and a Roth IRA in the same year because they have separate contribution limits set by the IRS.
  • For 2024, the Roth 401(k) limit is $23,500 (or $31,000 if you are age 50 or older) and the Roth IRA limit is $7,000 (or $8,000 if age 50 or older).
  • Your income determines whether you can contribute the full amount to a Roth IRA; Roth 401(k) contributions have no income limit.
  • You must have earned income from work in the year you contribute to either account.
  • Your employer must offer a Roth 401(k) option for you to use one; not all plans include it.

How the contribution limits work for each account

The IRS sets an annual limit for Roth 401(k) contributions and a separate annual limit for Roth IRA contributions. In 2024, you can put up to $23,500 into a Roth 401(k) if you are under age 50, or $31,000 if you are 50 or older (the extra $7,500 is called a catch-up contribution). These limits apply to the Roth 401(k) alone and do not reduce how much you can put into a Roth IRA.

For a Roth IRA, the 2024 limit is $7,000 if you are under 50, or $8,000 if you are 50 or older. This limit is separate from the Roth 401(k) limit. So in theory, a person under 50 could contribute $23,500 to a Roth 401(k) and $7,000 to a Roth IRA in the same year, for a total of $30,500 in Roth contributions.

The limits can change each year. The IRS adjusts them for inflation, usually in January. Check the IRS website or your plan documents for the current year's limits before you contribute.

Income limits for Roth IRA contributions

A Roth 401(k) has no income limit — anyone whose employer offers one can contribute, no matter how much they earn. A Roth IRA, however, has income thresholds. If your income is above a certain level, you cannot contribute the full amount, and if it is above a higher level, you cannot contribute at all.

The income limits for Roth IRA contributions depend on your filing status and change each year. For 2024, if you file as single, you can contribute the full amount if your modified adjusted gross income (MAGI) is under $146,000. The limit phases out between $146,000 and $161,000, meaning you can contribute a reduced amount in that range. If your MAGI is $161,000 or higher, you cannot contribute to a Roth IRA at all.

If you are married filing jointly, the income range for full contributions is under $230,000, with a phase-out between $230,000 and $240,000. These numbers shift annually. Your employer or a tax professional can help you calculate your MAGI if you are unsure whether you fall within the limit.

What happens if your income exceeds the Roth IRA limit

If your income is too high to contribute directly to a Roth IRA, you have other options. You can still contribute to a traditional IRA and then convert it to a Roth IRA later — this is called a backdoor Roth conversion. You can also contribute to a Roth 401(k) through your employer, which has no income limit.

A backdoor Roth involves putting money into a traditional IRA (which has no income limit) and then converting those funds to a Roth IRA. This strategy works, but it has tax consequences if you already have other traditional IRA balances. A tax professional can walk you through whether this makes sense for your situation.

The Roth 401(k) is often the simpler route if your income is high: you contribute directly through payroll, and there is no income limit to worry about.

You need earned income to contribute to either account

Both a Roth 401(k) and a Roth IRA require that you have earned income in the year you contribute. Earned income means money you made from working — wages, salary, self-employment income, or tips. It does not include investment returns, rental income, Social Security, pensions, or gifts.

The amount you can contribute cannot exceed your earned income for that year. If you earned $5,000 in 2024, you can contribute at most $5,000 to a Roth IRA, even though the limit is $7,000. The same rule applies to a Roth 401(k).

If you are married and one spouse has no earned income, that spouse generally cannot contribute to a Roth IRA. However, some married couples use a spousal IRA strategy, where the working spouse contributes to an IRA in the non-working spouse's name. This requires a special arrangement and is not available for 401(k) plans.

Whether your employer offers a Roth 401(k)

Not every employer offers a Roth 401(k) option. Some offer only a traditional 401(k), some offer both, and some offer neither. You can only contribute to a Roth 401(k) if your employer's plan includes it.

If your employer does not offer a Roth 401(k) but you want to save in a Roth account, you can still open and fund a Roth IRA on your own, as long as your income is within the limits. You can also ask your employer's benefits department whether they plan to add a Roth 401(k) option in the future.

If your employer does offer a Roth 401(k), you elect it during open enrollment or when you first become may be able to access for the plan. You choose what percentage of your paycheck to contribute, and your employer deducts it before taxes.

Tax treatment of contributions and withdrawals

Both a Roth 401(k) and a Roth IRA use after-tax dollars — you contribute money you have already paid income tax on. In return, your money grows tax-free, and you can withdraw it tax-free in retirement, as long as you meet the rules.

For a Roth IRA, you can withdraw your contributions (the money you put in) at any time, tax-free and penalty-free. Withdrawals of earnings (the growth) before age 59½ are usually taxed and penalized, unless you may have access to for an exception.

For a Roth 401(k), you cannot withdraw contributions penalty-free before age 59½ the way you can with a Roth IRA. The entire balance — contributions and earnings — is subject to the early withdrawal penalty if you take it out before 59½, with some exceptions. At age 59½, you can withdraw both contributions and earnings tax-free and penalty-free.

Frequently Asked Questions

Does contributing to a Roth 401(k) reduce how much I can put in a Roth IRA?

No. The Roth 401(k) limit and the Roth IRA limit are completely separate. You can max out both in the same year if you have the earned income and your income is within the Roth IRA limits. The only limit that ties them together is your total earned income for the year.

What if I contribute to both and then my income turns out to be too high for a Roth IRA?

If you over-contribute to a Roth IRA because your income was higher than you thought, you can ask your IRA provider to remove the excess contribution. You will owe income tax on any earnings that came from that contribution, but you can usually avoid the penalty if you catch it before you file your tax return. Talk to your tax preparer about the steps to take.

Can I roll over a Roth 401(k) to a Roth IRA later?

Yes. When you leave your job or retire, you can roll over your Roth 401(k) balance into a Roth IRA. This does not count as a new contribution and does not affect your annual contribution limit. The money keeps its tax-free status in the new account.

Do I have to contribute to a Roth 401(k) if my employer offers one?

No. Contributing to a Roth 401(k) is optional. If your employer offers one, you can choose to contribute, choose not to contribute, or contribute a different amount each year. You can also switch between Roth and traditional contributions during open enrollment.

What if I have both a Roth 401(k) and a traditional 401(k) at the same employer?

Some plans allow you to contribute to both a Roth 401(k) and a traditional 401(k) in the same year. Your combined contributions to both cannot exceed the annual limit ($23,500 in 2024 if you are under 50). Check your plan documents or ask your benefits administrator whether your plan allows this.